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Shopko, Pamida wrap up merger deal
March 1st, 2012
GREEN BAY, Wis. and OMAHA, Neb. – Shopko Stores and Pamida have finalized their merger deal announced earlier this year, create a chain drug retailer with nearly 300 pharmacy locations in more than 20 states.
As announced when the merger was unveiled in early January, the Midwestern general merchandise retailer, which primarily serves smaller, rural communities, will use the Shopko name and be based in Green Bay.
Pamida's corporate headquarters in Omaha will be consolidated into the Green Bay office over the next several months, the companies said Thursday.
Shopko chairman, president and chief executive officer W. Paul Jones will lead the combined company. Pamida CEO John Harlow will serve on the leadership team and help direct the integration process.
Overall, the combined entity will have nearly 350 locations in 22 states and annual sales of about $3 billion. Financial details of the merger were not disclosed.
"A great deal of work and planning was required to get us to this point, and we're excited that the merger is now complete so we can begin to move forward as one organization," Jones said in a statement.
Shopko said the Pamida stores will be converted to the Shopko Hometown store format by the end of this year. As part of that process, six stores will be closed in August. The Hometown format combines pharmacy services with an offering of national brands and private-label brands of apparel, home furnishings, toys, consumer electronics, seasonal items, and lawn and garden products in stores ranging from 15,000 to 35,000 square feet.
Plans call for Shopko to invest about $80 million into the Pamida store conversions, which will kick off in June and be done in phases through the rest of the year.
Shopko said that once Pamida's chainwide conversions are finished, the company aims to ramp up the addition of new Shopko Hometown stores in the second half of the year and into 2013.
Both Shopko and Pamida are owned by affiliates of private equity firm Sun Capital Partners. Shopko's 149 stores span 13 states throughout the Midwest, Mountain and Pacific Northwest regions. Its formats — all with pharmacies — include 134 Shopko stores, five Shopko Express Rx stores and 10 Shopko Hometown locations. The Pamida chain encompasses 193 stores in 17 states, mainly in the Mountain, North Central and Midwest regions, and 132 of the stores have pharmacies.